You have said that you would support

“the introduction of statutory targets on how much is spent by public bodies with small businesses each year.”

How would that work practically? A small business may not produce a specific product that a public body might require. In general, how would setting statutory targets align with the aim to make Scotland more competitive?

My area, North Ayrshire, has done similarly.

I will let Lesley in to respond to that, but then I will go to Tom Ockendon because his is the only paper that I have not referenced yet and I want to ask him about it. Michelle Thomson will be the last member to contribute. After that, we will have to go to wind-up points, because time is against us—we are already just about out of time. I will give all five of our guests an opportunity to make any final points that they might wish to make. Andy Witty will be the last to speak, because he was the first to speak at the start of the meeting.

Right, so you are just putting down a marker and expressing concern about that.

You touched on adaptations earlier, and the fact is that small investments there can make a big difference.

Thank you for that bold and helpful opening statement. I am delighted that you are here this morning because we have discussed social security ad infinitum over the years on this committee, but it has always been through a finance secretary rather than with you or your predecessors—those who are directly responsible for it.

The catalyst for inviting you here this morning is the article in The Scotsman about the £36 million that, allegedly, the Scottish Government is not pursuing. That caused considerable concern among members of the committee. In relation to the freedom of information requests, a Scottish Government spokeswoman was quoted as saying:

“The Scottish social security system is focused on treating people with fairness, dignity and respect. Scottish Ministers have been clear they cannot support UK Government proposals to take powers to recover directly from an individual’s bank accounts without requiring a court order, or to potentially suspend driving licences.”

It is suggested in the article that although the spokeswoman said that there was no hole in the Scottish budget, there was no elaboration on where the money would be found to write off the £36 million in alleged fraud and overpayments. Clearly, if that is not recovered, that would be £36 million lost to the Scottish Government. You talked about fraud methods. How are we ensuring that fraud is minimised? What is being done to restore that money to the Scottish budget?

Universities Scotland told us that

“the flexible workforce development fund”,

which is

“valued at £10.5 million a year, was discontinued in 2023-24”

and that

“the Open University ... had to turn away ... 1,000 learners”,

many of whom, I imagine, would have been from disadvantaged communities. Universities Scotland also told us that

“The Scottish Funding Council’s upskilling fund”,

which was

“previously valued at £7 million ... was also discontinued”

last year. Those measures have been taken to save money here and there, yet, as you pointed out in your opening statement, additional funding of at least £1.2 billion—the Scottish Fiscal Commission said that it is £1.3 billion—is going into measures over and above devolved benefits. However, that £1.3 billion is coming out of other areas. Local government tells me that it is having to cut virtually all non-statutory services, including support for people with debt, for example, people who are unemployed and childcare facilities.

It is not as if the money that the Scottish Government is investing in welfare is over and above; it is being taken from those other services. Therefore, because of the emphasis on welfare, other areas are being denuded of resources, including areas that local government feels are essential to get people out of poverty. That is the irony of it. The Scottish Government keeps talking about welfare being an investment in people, but what analysis has been done to compare the outcomes for people who receive higher benefits with the outcomes for people from investing in employability, college places or universities?

I think that everyone would agree that those payments will make people’s lives less awful if they are on benefits, because more money always does. However, how does it lift people out of poverty and give them a different kind of life, in which they will be in employment, be able to look after themselves in that way and not be dependent on benefits? That is where we are going.

I understand that the Convention of Scottish Local Authorities raised a concern about the two-child cap a couple of weeks ago. I raised that with the Cabinet Secretary for Finance and Local Government, who said that there were on-going discussions with the UK Government. The Scottish Government signalled the policy change a considerable number of months ago, and the Labour Party said that it would support the budget only if we ended the two-child cap during this financial year. To be honest, that was a bit of kidology. If that is the case, why are discussions still on-going about whether housing benefit and council tax benefit will be impacted by the ending of the two-child cap? In other words, if we give families additional resources through ending the two-child cap, they could no longer be eligible for other benefits. Has that been sorted now? Two weeks ago, my understanding was that the matter was still under discussion.

The term was “vulnerable two-year-olds”.

There is still a cash threshold of £850 a month.